Study finds minimum wage tough on renters
By Eun-Kyung Kim
Associated Press
WASHINGTON — No-where in the country — including Hawai'i — can a minimum-wage employee afford to pay rent on a two-bedroom home, an advocacy group said yesterday. And in three-quarters of the country, even two full-time, minimum-wage jobs couldn't pay for such housing.
Here are the least-affordable states for housing and the hourly wage needed to pay for an average two-bedroom apartment, according to the National Low Income Housing Coalition. (Note: The state list includes Washington, D.C.) State Wage Calif. $19.69 National average $14.66
The National Low Income Housing Coalition, in its annual "Out of Reach" report, found that the average U.S. employee must make nearly three times the federal minimum wage, or about $14.66 an hour, to afford a modest two-bedroom rental and still pay for food and other needs.
The high cost of renting
D.C. $19.21
N.J. $18.85
N.Y. $18.24
Conn. $17.03
Md. $16.82
Hawai'i $16.74
Alaska $16.19
Colo. $15.99
N.H. $15.77
The study found California to be the least-affordable state, with workers having to earn $19.69 per hour to pay for an average apartment.
Hawai'i ranked seventh least affordable, according to the study, at $16.74.
About one-third of the nation's households are renters, said the Washington-based advocacy group, which favors increased federal spending on affordable housing and raising the minimum wage to address the issue.
Last year, about 2.2 million workers earned the federal minimum wage of $5.15 an hour or less, according to the Bureau of Labor Statistics.
Although some states, including California and Hawai'i, have higher state minimum wages, they still fall far short of covering an average rent. Hawai'i's minimum wage rose from $5.25 to $5.75 an hour in January, and is scheduled to increase another 50 cents, to $6.25, on Jan. 1.
The coalition's study is based on the Department of Housing and Urban Development's determinations of "fair market rent" in states, counties and metropolitan areas. Each jurisdiction's "housing wage" was then established by calculating how much a person would need to earn per hour to pay no more than 30 percent of income for those rents.
HUD considers housing affordable when it costs 30 percent or less of gross income.
The report found that 37 states had housing wages greater than twice the minimum wage; in nine states, the housing wage was three times the minimum wage.
